Warren Buffet Investing Style

Open ZERO Brokerage FREE Share Trading Account - Buy and Sell Stocks Without Brokerage - Set GTT (Good Till Triggered) Orders on System and Forget

This week I finished reading a book written by Robert G. Hagstrom about Warren Buffett – the best investor in world entitled “The Warren Buffett Portfolio.”.

This book is different than what I have read on Warren Buffett in other books.

Here I would like to point out some very important highlights of the book.

Stock Is a Business

Before you buy a stock you must think whether you want to be a part owner of that business? If you are not comfortable being its owner then do not buy that stock.

Think Long Term

If you want to start a business, do you want to keep making money for the short term or long term? Of course you will plan for the long term. Same should be the case if you want to buy a stock for investing not trading.

Note that stock investing is not the same as stock trading.

Stock trading is buy and selling a stock for intraday, few days or few months. Stock investment is holding a stock for at least about a year. Though Warren Buffett average holding period is more than 5 years.

Increase Your Investment Size and Do Not Diversify

Warren Buffett did not believe in too much diversification neither keeping all eggs in one basket. He did thorough research and invest a lot of money in a stock for a long timeframe. Warren Buffett did not invest in mutual funds also as he was against too much diversification. His exact number of stock holding is unknown.
.
However if you are not as good investors as Warren Buffett, it is advisable to invest in mutual funds.

Reduce Turnover

Warren Buffett believed not to churn in and out of stocks frequently to avoid paying taxes on gains made. In India long term capital gains are not taxed. For that one needs to hold the stock for at least one year. Warren Buffett that taxes will reduce the profits coming out of the stock investments.

In India long term profits are not taxed because the company has already paid their taxes. The profits you get after selling the stocks after one year is after paying the taxes by the owners of the company. Since the taxes has already paid there is no need to pay taxes again. However short term profits (less than one year holding) are taxed.

Ignore What Experts Say

Warren Buffett rarely listened to experts forecast on future of a stock price long or short term. He focussed on fundamentals of a company. If believed that if a company is good at fundamentals the stocks will price in that in future.

COPYRIGHT INFRINGEMENT: Any act of copying, reproducing or distributing any content in the site or newsletters, whether wholly or in part, for any purpose without my permission is strictly prohibited and shall be deemed to be copyright infringement.

INCOME DISCLAIMER: Any references in this site of income made by the traders are given to me by them either through Email or WhatsApp as a Thank You message. However, every trade depends on the trader and his level of risk-taking capability, knowledge and experience. Moreover, stock market investments and trading are subject to market risks. Therefore there is no guarantee that everyone will achieve the same or similar results. My aim is to make you a better & disciplined trader with the stock trading and investing education and strategies you get from this website.

DISCLAIMER: I am NOT an Investment Adviser (IA). I am an Authorized Person (AP) of a Stock Broker. I do not give tips or advisory services by SMS, Email, WhatsApp or any other forms of social media. I strictly adhere to the laws of my country. I only offer education for free on finance, risk management & investments in stock markets through the articles on this website. You must consult an authorized Investment Adviser (IA) or do thorough research before investing in any stock or derivative using any strategy given on this website. I am not responsible for any investment decision you take after reading an article on this website. Click here to read the disclaimer in full.

Disclaimer | Privacy Policy | About Me | Conservative Option Course
Find 200+ testimonials of my course:
What Traders Say About This Course

My student gets the Winner's Certificate of Zerodha 60-day Challenge - Click here and Open Stock Buy and Sell Free Account with Them Today!!!

Open ZERO Brokerage FREE Share Trading Account - Buy and Sell Stocks Without Brokerage - Set GTT (Good Till Triggered) Orders on System and Forget

Traditional brokers charge a lot for brokerage; however, this broker does not charge anything for stock buying and selling. Also, you can set GTT (Good Till Triggered) order after buying a stock, so that the system can sell the stock automatically at your target price even if you are not monitoring the market. Only 25k is blocked for option selling with hedge. Also, you get a lifetime free account in Sensibull (virtual trading app & strategy builder) which charges Rs.800/-+GST a month. It takes 5 minutes to open an account online. Click here and Open Free Account with Them Today >>